Costs of renting Taiwan’s bureaus in Hong Kong, Macau facing scrutiny

By Chen Hui-ping
and Stacy Hsu / Staff Reporter, with Staff Writer

Sun, Oct 21, 2012 - Page 3

The Mainland Affairs Council’s (MAC) budget statement for next year has come under fire for its “lack of rationality” with a focus on the NT$76.55 million (US$2.61 million) allocated for rental expenditure and personnel costs incurred by the country’s liaison offices in Hong Kong and Macao. The figures amount to an NT$18 million increase this year alone.

An evaluation report by the Legislative Yuan’s Budget Center said the council’s proposed rental budget for its Bureau of Hong Kong Affairs — Taiwan’s de facto embassy in the city — has increased by 37.8 percent to NT$65.09 million in one year alone.

Singling out the facilities rented by Taiwan’s representative to Hong Kong, James Chu (朱曦), which occupy 83.33 ping (275.5m2) with an annual rental of NT$4.2 million, the budget center said this contradicted the government-trumpeted principle of frugality and should be reviewed and adjusted.

The council said in a statement that the budget increase was due to a vacancy rate of less than 8 percent for Grade-A office space in Hong Kong which made the region particularly prone to rent increases.

However, an analysis by the international real estate consultancy DTZ ran counter to the council’s statement and stated that only a moderate increase in vacancy rates has actually been seen this year.

MAC Department of Hong Kong and Macao Affairs Director Yan Chung-kuang (嚴重光) said in response that Hong Kong is a place where office buildings are in limited supply and have a non-negotiable rental rate which is highly responsive to current market values.

“The bureau has been renting its office space at a rate lower than the market price over the past few years from a Taiwanese expatriate. However, the rent was recently adjusted after the property was transferred to the landlord’s offspring,” Yan said.

The bureau’s office is located in the Lippo Center skyscraper in Queensway, an area that hosts many foreign consulates and serves as an index of rental rates for office space on Hong Kong Island.

Democratic Progressive Party Legislator Chen Chi-mai (陳其邁) questioned the necessity of spending NT$5.42 million a month on such a spacious office as the bureau’s administrative duties have reduced since the Hong Kong government granted Taiwanese visa-free entry.

“How come the former representative to Hong Kong was housed in a home of 61.9 ping, while Chu got to relocate to a bigger house after he assumed the post?” Chen added.

In response, Chu said he had originally planned to stay in the same place, but was forced to relocate because the lease on the residence of the former representative expired by the time he took up the post in January last year and the landlord proposed a rent increase.